gas pipelines in nigeria: sine qua non for economic

[Biose Vol6 (Iss4) April 2019] ISSN 2454-1907

DOI 105281zenodo2653083

HttpwwwijetmrcomcopyInternational Journal of Engineering Technologies and Management Research [18]

GAS PIPELINES IN NIGERIA SINE QUA NON FOR ECONOMIC

DEVELOPMENT Henry Biose 1

1 Emerald Energy Institute for Petroleum and Energy Economics Policy and Strategic Studies

University of Port Harcourt Nigeria

Abstract

The study reviewed the gas pipeline development in Nigeria and outlines needed strategies

needed for sustainable development of gas pipeline for socio-economic development in Nigeria

There is inefficient gas pipeline development framework in Nigeria based on the existing

monopoly of the Nigerian Gas Processing and Transportation Company Limited (NGPTC)

managing 1500 to 2000 km of gas pipeline all over Nigeria while this is grossly inadequate to

meet the domestic supply obligation Extensive review of related literature was employed to

obtain relevant data and information on the Nigerian gas pipeline The study shows that gas

pipeline is inadequate and additional 5000km is required to meet the short and medium need

while about 10000km gas pipeline will be needed in the long run The study further revealed

that gas is major source of revenue as N727 billion was generated from between 2017 and 2018

The study also reviewed the eight (8) critical gas infrastructures identified by the federal

government of Nigeria of which Obiafu-Obrikom-Oben (OB3) Pipeline Project and Ajaokuta-

Kaduna-Kano (AKK) Pipeline Project has the final investment decision taken and are at

construction and detailed engineering phase respectively The proposed strategy to enhance gas

pipelines development in Nigeria should be private sector driven and divestment of all existing

gas pipeline infrastructure to private investors in order to ensure sustainable management that

would increase the Gross Domestic Product (GDP) create employment and provide access to

relatively clean energy There is also need to have a gas pipeline transmission and distribution

act that would stipulate the minimum requirement for gas pipeline investment in Nigeria

Keywords Gas Pipeline Gross Domestic Product Transmission and Distribution Sustainable

Development Economic Development Domestic Supply Obligation

Cite This Article Henry Biose (2019) ldquoGAS PIPELINES IN NIGERIA SINE QUA NON FOR

ECONOMIC DEVELOPMENTrdquo International Journal of Engineering Technologies and

Management Research 6(4) 18-33 DOI 105281zenodo2653083

1 Introduction

There is inefficient gas pipeline development framework in Nigeria as the existing pipelines

(transmission and distribution) have been solely managed by the federal government through its

agencies and parasatals which includes Nigerian Gas Processing and Transportation Company

Limited (NGPTC) Nigeria Gas Marketing Company Limited (NGMC) and Department of

Petroleum Resources (DPR) and they are in control of approximately 1500 to 2000 km of gas

pipelines all over Nigeria with limited or negligible private sector participation and this has

brought to you by COREView metadata citation and similar papers at coreacuk

provided by ZENODO


DOI 105281zenodo2653083


resulted to having inadequate domestic gas supply obligation because the pipeline infrastructures

are not enough to meet the local demand of natural gas (Department of Petroleum Resource Annual

Report 2017) According to DPR (2017) the Nigerian national pipeline capacity for the year 2018

is 29 bscfd with 20 bscfd for the western region axis and 09 bscfd for eastern region axis and

this is relatively small to support economic development in Nigeria While according to the

National Gas Policy (2017) there are proposed gas pipeline network but the economics and

commercial framework for this proposed pipeline network are still vague and need to be modeled

for economic development from conceptual stage to operations considering the Nigerian socio ndash

economic conditions and long term framework that would generate revenue to the Nigerian

government and create positive economic multiplier effect such as increase in direct and indirect

employment The existing spread of gas pipelines is categorized into northern region western

region and eastern region Figure 10 shows the gas pipeline network within the northern region of

Nigeria and this clearly shows lack of gas pipelines within this region

Figure 10 Northern Region Gas Pipeline Network

Source Nigerian Gas Processing and Transportation Company (2017)

While figure 11 shows the western and eastern region gas pipeline network indicating the

inadequacy of the existing gas pipeline network though as the region with relatively more gas

pipeline network and this is still inadequate to meet the demand or domestic supply obligation as

there no gas distribution network within any major city or town in this region of Nigeria


DOI 105281zenodo2653083


Figure 11 Western and Eastern Region Gas Pipeline Network


The Nigerian gas pipeline economics planning and commercial framework is relatively very poor

There is no existing gas pipeline transmission system with an effective commercial frame work to

encourage private investors to competitively build gas pipeline infrastructures that would create

economic benefit in terms of boosting revenue to the government improved direct and indirect

employment for the growing population of over 180 million people The existing economics and

commercial framework for the Ajaokuta-Kaduna-Kano (AKK) 614Km gas pipeline that is being

developed by the Nigerian National Petroleum Corporation (NNPC) and financed by the Chinese

partners has not created any economic framework and benefit such as massive employment for

young and experience engineers technologist and artisans from Nigeria due to poor gas pipeline

economics and planning

There is no policy framework enacted by the federal government of Nigeria on gas pipeline

transportation (gathering transmission and distribution) that would support effective management

of gas production and utilization for economic development in Nigeria The existing framework

includes the following Acts Plan and Policy documents

1) Petroleum Act (1969)

2) Oil Pipeline Act (1965)

3) Guidelines for the Construction Operation and Maintenance of Oil and Gas Pipelines and

their ancilliary facilities

4) Gas Master Plan (2008) ndash There is no formal document on the gas master plan

5) National Gas Policy (2017)

The aforementioned documents did not set out the framework for sustainable gas pipeline

infrastructure in Nigeria As a result of these problems Nigeria has increasingly become a mono


DOI 105281zenodo2653083


economy that is highly dependent on crude oil exports with poor attention to gas development

using pipeline transportation

Natural gas is a major contributor to the Gross Domestic Product (GDP) of many countries and it

is employing thousands of people generating millions of dollars in revenue and tax income

Natural gas is produced from the ground in large volume in order to be economically viable and

from an international or global perspective it is projected that $231 billion would be added to the

United States of America economic performance in 2035 from the gas industry while according

to DPR (2017) Nigeria looses $10 billion due to gas flaring at the rate of $200 per MMBtu

(wwwiguorgnatural-gas-powers-economic-growth)

NMA (2016) states that typically natural gas plays key role in manufacturing industries in many

developed economies and the transmission pipeline is required to move the natural gas to the

market United States of America spent 258 billion in year 2015 for the construction of 6028

miles (970113 Km) of natural gas transmission pipelines with creation of 347788 jobs while

according to DPR (2017) about $35 billion worth of inward investment is required to achieve the

gas flare target by 2020 in Nigeria with projection of 300000 associated jobs to be created

Gas production and utilization has been struggling to meet with domestic gas supply obligation

due to lack of critical gas infrastructure which is the pipeline and presently there is a daily average

domestic gas supply performance of 41 resulting from 106558 MMscfd supplied to the domestic

market by eleven companies(DPR2017)

Derefaka (2018) posits that Nigeria loses approximately $1 billion of revenue through gas flaring

due to its inability to capture and commercialise flared gas in the country He further stated that if

flared gas is properly exploited it has the potential to create 300000 jobs produce 600000 MT

of LPG per year and generate 25 GW of power from new and existing IPPs as approximately

700mmscfd is flared at 178 flare sites in Nigeria Diugwu et al (2013) examined the relationship

of gas production utilization and flaring on economic growth of Nigeria using the classical Cobb-

Douglas production which posited that gas has a negative effect on the economic growth and that

gas production is insignificant to economic growth in Nigeria However Oduyoye et al (2013)

explained that there is no casuality between natural gas composition and Gross Domestic Product

(GDP) in the short run and posits that Nigeria has not been able to tap her natural gas due to poor

infrastructure and as a result most of the gas are been flared

The purpose of this study is to review the gas pipeline infrastructure development in Nigeria and

to outline necessary strategies needed for sustainable development of gas pipeline for socio-

economic development in Nigeria

This study is significant because natural gas is a resource that is more abundant and widely spread

and this implies that it is more diversified than oil in terms of availability and this diversified gas

should ensure better security of supply (BP Statistics 2017)

Secondly natural gas is making significant contribution to the world energy economy because it

is the cleanest of all fossil-based fuels as natural gas emits 561 tCO2 per TJ while the emissions

from oil and coal are 733 tCO2 and 946 tCO2 respectively according to Subhes (2011) According

to World Energy Council (2013) Natural gas emits 30 less CO2 compared to oil and almost 70


DOI 105281zenodo2653083


less compared to coal for an equivalent amount of energy Therefore as the reduction of greenhouse

is expected to gain momentum in the future natural gas will surely strengthen its position and be

a necessity for gas based industrialization and basis for sustainable economic development

Therefore the aim of this study is to outline economic strategies for the development of gas

pipelines necessary for sustainable economic development in Nigeria

2 Materials and Methods

The study adopts extensive literature and analytical framework model to determine the strategies

necessary for gas pipeline and these include the following steps

1) Extensive review of gas pipeline development in Nigeria

2) Review of the Nigeria critical gas pipeline infrastructure

The analytical framework involves extensive review and research deductions The analytical

framework steps include the following

bull Analysis of the gas pipeline developments in Nigeria

bull Analysis of the critical gas pipeline infrastructures in Nigeria

The major sources of data in this study include the following

1) Department of Petroleum Resource Annual Reports

2) Gas Aggregation Company of Nigeria (wwwgacncom)

3) Nigerian National Gas Policy (2017)

3 Results and Discussions

31 Gas Pipelines Development in Nigeria

Gas pipelines have been developed by the Nigerian National Petroleum Corporation (NNPC)

through its strategic business unit Nigerian Gas Transportation and Processing Company

(NGTPC) formally Nigerian Gas Company (NGC) with varying economic models and

frameworks while the regulations of the gas pipeline is by Department of Petroleum Resource

(DPR) (wwwnnpccom)

According to Adamu and Darma (2017) there have been gas pipelines in Nigeria as early as 1960

but this is not sufficient to deliver to the power stations industries and other consumers with about

2000 km network of gas pipelines currently operating in Nigeria There is gas pipeline inadequacy

in Nigeria with about 5000 km required Nigeria gas to electricity sector comprises about a 1000

km of pipelines and to meet the required demand Nigeria needs about 10000km of gas pipelines

(wwwgreendealnigeriaorg) However according to Ndukwe (2007) the historical development

of gas pipeline and utilization in Nigeria is as follows

bull 1956 First oil and gas discovery

bull 1958 First commercial exploitation of oil

bull 1963-1968 first non ndash commercial use of gas by SPDC to ECN Afam Delta PPs and Aba

industries


DOI 105281zenodo2653083


bull 1978 NNPCSPDC built 1st transmission pipeline (Ogorode ndash Sapele) to supply ECN

Sapele

bull 1981-83 NNPC built pipeline to supply steel companies at Aladja and Ajaokuta

bull 1987 NGC built pipeline to supply NAFCON (Now Notore) Onne fertilizer

bull 1988 NGC established to transport and market gas in Nigeria and West Africa sub-region

bull 1989 Escravos ndash Lagos gas pipeline system (ELPS) was built

bull 1999 NLNG export commenced

bull 2000 Gas distribution to industries in Lagos commenced

bull 2004 Final Investment Decision (FID) on first export pipeline (WAGP)

bull 2005 The electricity sector reformed by Act of Parliament

bull 2005 New LNG programmes at advanced stages (Brass OK etc)

bull FID for first commercial GTL plant by Chevron Nigeria Limited

bull 2006 Increased in-country capacity for cement-Obajana commenced operation

bull According to National Gas Policy (2017) the identified critical gas infrastructures in

Nigeria necessary to support efficient and stable gas demand and supply projected to

support economic development includes

1) Aba-Owerri-Nnewi-Onitsha Pipeline Project

2) Calabar-Ajaokuta Pipeline (CAP) Project

3) Ajaokuta-Kaduna-Kano (AKK) Pipeline Project

4) ELP-Ibadan-Jebba Pipeline Project

5) Obiafu-Obrikom-Oben (OB3) Pipeline Project

6) Expansion of ELP Phase 2 Project

7) Oso Platform to QIT Pipeline Project

8) Erha Bosi Pipeline Project

In terms of revenue generation from gas transmission and distribution as reported by Nigerian

National Petroleum Corporation in year 2018 (reported on 8th July 2018) it states that the year

under review yielded a total revenue from gas transmitted is N727billion translating to 29291

billion standard cubic feet of gas as against the planned 42992bscf thereby achieving 68 13

percent of its target Profit before tax was N675billion while profit after tax came to N611 billion

within the period (wwwnnpccom)

Generally pipelines are part of the core infrastructure in the value chain of gas industry and

pipelines are piping that transport fluids between offshore production facilities or between a

platform and a shore facility Pipeline can be sub-classified into three categories of flowlines

Injection lines and export lines (API 1111 2009) According to Engineering Science (2006)

pipelines transport liquid petroleum products from one point to another and there are generally

three types of pipelines namely Gathering lines Feeder lines and Transmission lines

Gas pipelines are usually designed and manufactured in accordance to the American Petroleum

Institute (API) standards and they are classified by grades the grade of the pipeline denotes the

thickness of the internal thickness of the pipelines that has been designed and manufactured to

prevent internal corrosion and operational stresses during the design life of the pipeline The wall

thickness of the pipeline takes into consideration the effect of internal corrosion of the pipeline

due to the service or process fluid


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Wall thickness formula as per ASME B318 for gas pipes is shown as follows

(311)

( (312)

S = Specified Minimum Yield Strength psi

t = nominal wall thickness of pipe in D = nominal outside diameter of pipe in F = design factor

E = longitudinal joint factor

T = temperature derating factor

c = corrosion allowance in P = design pressure or MAWP psig

311 Gas Pipeline Projects in Nigeria

The Infrastructure blue print for the Gas Master Plan (GMP) which mapped out the planned gas

pipeline infrastructure needed including connecting the gas networks in the western and eastern

parts of the country building new pipelines from the south to Ajaokuta and to Abuja and then to

the northern part of the country The first part of the infrastructure required the construction of

Central Processing Facilities (CPFs) in the Niger Delta region to process wet gas supply to onshore

gas transportation networks and industrial plants and further to the Gas Master Plan about 590km

of gas pipelines have been completed and commissioned and these pipelines include the following

bull Oben ndash Geregu (196km)

bull Expansion of Escravos -Warri-Oben (110km)

bull Emuren-Itoki (50km)

bull Itoki ndash Olorunshogo (31km)

bull Imo River ndash Alaoji (24km)

bull Ukanafun-Calabar (128km)

bull NOPL (50km)

With these projects it is expected that all the available power projects in Nigeria are connected to

permanent gas supply pipelines (wwwnnpccom)

3111 The West African Gas Pipeline Project

The west african gas pipeline project objective is to supply gas to some Economic Community of

West African States (ECOWAS) countries as a result of Nigeriarsquos commitment to Article 48 of

the ECOWAS treaty which encourages member nations to co-operate consult and co-ordinate

their policies regarding energy and mineral resources The governments of Nigeria Ghana Benin

and Togo through their ministries and departments responsible for energy matters signed Heads

FETD

ctSPMAWP

)(2)(

minus=

cSFET

PDt

DESIGN+=

2

)(

(min)


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of Agreements (HOA) in 1995 to provide a framework of the project and project Implementation

Committee to monitor the development of the project

A commercial group comprising Nigerian Gas Company (NGC) and now Nigerian Gas Processing

and Transportation Company (NGPTC) Ghana National Petroleum Corporation (GNPC)

SOBEGAZ (Benin) SOTOGAZ (Togo) Chevron Nigeria Limited (CNL) and Shell Petroleum

Development Company (SPDC) are involved in the gas sales supply arrangement

(wwwnapimscom)

According to wwwwagpcocom The West African Gas Pipeline Company limited (WAPCo) is a

limited liability company that owns and operates the Pipeline The headquarters is in Accra

Ghana with an office in Badagry Nigeria and field offices in Cotonou - Benin Lome - Togo

Tema and Takoradi both in Ghana It is owned by Chevron West African Gas Pipeline Ltd

(369) Nigerian National Petroleum Corporation (249) Shell Overseas Holdings Limited

(179) and Takoradi Power Company Limited (163) Societe Togolaise de Gaz (2) and

Societe BenGaz SA (2)

WAPCo Pipeline System

According to wwwwagpcocomWAPCo pipeline system is a 678 kilometer that links the existing

Escravos-Lagos pipeline at the Nigeria Gas Companyrsquos at Itoki natural gas export terminal in

Nigeria and proceeds to a beachhead in Lagos From there it moves offshore to Takoradi in

Ghana with gas delivery laterals from the main line extending to Cotonou (Benin) Lome (Togo)

and Tema (Ghana) The Escravos-Lagos pipeline system has a capacity of 800 MMscfd and the

WAPCo system will initially carry a volume of 170MMscfd and peak over time at a capacity of

460MMscfd

The main offshore pipeline runs from east to west at an average water depth of 35 metres through

some sections such as the south east of Ghana south of Lome and the Benin ndash Nigerian frontier

ranges between 50 to 70 meters20 inches pipeline is the main line while Cotonou and Lome

laterals are 8 inches respectively Tema lateral is 18 inches The termination point at Takoradi

(Aboadzi) forms part of the main pipeline

The pipeline transports purified natural gas free of heavy hydrocarbons liquids and water this is

ideally suited as fuel for power plants and industrial applications Eighty-five per cent (85) of

the gas is for power generation and the remaining for industrial applications The customer

offtakers includes the Volta River Authorityrsquos Takoradi Thermal Power Plant in Ghana CEB of

Benin and Togo

3112 Trans-Sahara Gas Pipeline (TSGP)

The Trans Saharan gas pipeline project (also known as the Algeria-Nigeria Gas Pipeline Project)

is a planned investment of about $200billion The Project is planned when completed that it will

transport up to 30 billion cubic metres of natural gas from Warri (Nigeria) through Niger Republic

to Algeria on an annual basis The aim of the project is to diversify gas supplies to Europe The

pipeline will be built and operated by the partnership of the Nigerian National Petroleum

Corporation (NNPC) and Sonatrach The NNPC and Sonatrach will hold a total of 90 per cent


DOI 105281zenodo2653083


equity shares while Niger Republic would hold 10 per cent The total length involved is 4128

kilometers (2565 miles) with the Nigerian section being 1037 kilometers (644 miles) kilometers

(523 miles) and 2310 kilometers (1440 miles) in Algeria The French Total Oil Company and

Russian Gazprom are interested in participating in the project This is expected to cost about $12

billion for the pipeline and $3 billion for the gathering centres The benefits derivable from the

project by Africa and Europe are enormous First it will contribute to the export diversification

drive of the Federal Government of Nigeria (FGN) Secondly it means an opportunity for closer

cooperation integration and a significant income for the transit countries such as Niger Burkina

Faso and Mali as well as Algeria

32 Gas Pipeline Economics in Nigeria

Nwaozuzu (2018) states that typical natural gas pipeline construction costs vary between US$

800000 per km to US$ 2 million per km (for large diameter projects over rugged terrain) while a

typical LNG project may require more than US$10 billion of investment and lead time of 6-10

years from conception to completion LNG tanker ships cost about US$200 million The cost

associated with gas pipeline construction from global perspective is noted in this study

considering the fact that gas is a global commodity and the pipeline are designed to international

standard such as American Petroleum Institute National Association of Corrosion Engineer etc

while the typical cost associated with gas pipeline projects includes the following

1) 24 inch Yucatan Peninsula gas pipelines completed in 1999 and running 432 miles from

the Mexican State of Tabasco to power plants in the Yucatan province cost US$266

million

2) 460 km line completed in 1996 from La Mora in Argentina to Santiago in Chile cost

US$360 million

3) The 3700 km pipeline from Bolivia to Sao Paulo in Brazil cost US$18 billion

While according to www nnpccom the NNPC is currently developing the Ajoakuta-Kaduna-

Kano (AKK) 614km pipeline and it is fully contractor financed economic model involving the

Chinese Corporation with 85 per cent of the money is expected to be funded by Industrial and

Commercial Bank of China (ICBC) Bank of China and Infrastructure Bank of China with

Sinosure Chinarsquos Export Credit Agency (ECA) providing insurance cover the remaining 15 per

cent will be provided by the contractors which include OilserveOando consortium as well as

BrentexChina Petroleum Pipeline (CPP) Bureau consortium and this project to bring $3billion

foreign direct investment into Nigeria The project is currently at detailed engineering phase with

The engineering procurement and construction (EPC) contract for phase one was awarded to

OilServe Oando consortium in April 2018The Brentex China Petroleum Pipeline Bureau (CPP)

consortium was awarded the EPC contract for phase three According to wwwhydrocarbons-

technologycom the pipeline is to originate from Ajaokuta and pass through Abuja and Kaduna

and end at terminal gas station in Kano The project will be executed in three phases with phase

one covering the construction of a 200km-long segment between Ajaokuta and Abuja Terminal

Gas Station at a cost of $855mPhase two will comprise a 193km-long section to be built between

Abuja and Kaduna at a cost of approximately $835m while Phase three will involve the

construction of a 221km-long section between the Kaduna terminal gas station (TGS) and Kano

TGS This section will cost an estimated $12bn to complete Other infrastructure planned for the

development includes various associated valve stations as well as intermediate and terminal


DOI 105281zenodo2653083


facilities The natural gas pipeline is expected to require the laying of 40in-diameter pipes featuring

a total combined weight of 240768t Furthermore the project will utilize 24in-diameter steel line

pipes for spur lines as well as 40in-diameter line break valves and future tie-in valves

The multi-million dollar (the project was estimated to cost over $400 million) OB3 gas pipeline is

expected to increase domestic gas supply by two billion standard cubic feet per day (bscfd) when

it begins operation later in the year (wwwthenationonlinengnet)

The west african gas pipeline construction and operations obtained financial guarantees of the

World Bank The total project cost is US$974 million out of which The World Bank guarantee

for Ghana was $80 million while the Multilateral Investment Guarantee Agency (MIGA) provided

a $75 million political risk guarantee for the West African Gas Pipeline Company which is set up

to build own and operate the pipeline Plans are in the offing to extend the gas supply to Abidjan

(Dami 2012)

Herein below is a list of contract signed to enhance gas production and maximize economic gain

1 The Tran-Sahara Gas Pipeline 30 billion cubic meters capacity per year using 48 to 56

inches to be routed from Nigeria to Algeria and this would eventually serve other European

countries on the long run The pipeline will be connected to the Trans-Mediterranean

Maghreb-Europe Medgaz and Galsi pipeline which shall supply the gas to European

countries

Pipeline Length = 4128km (1037km-Nigeria 841km-Niger and 2310km-Algeria)

Business interest (Nigeria -45 Algeria-45 and Niger Rebulic-10)

According to Nwaozuzu (2017) there is waste of natural gas because of transportation difficulties

and this is a problem because of the huge cost associated with engineering procurement and

installation of natural gas pipelines it cost about 4-5 times as much to transport gas over land by

pipeline compared to the cost of transporting oil Nigeria as a gas producing nation lacks the

pipeline infrastructure for domestic regional and global market The transportation cost of natural

gas is a major factor driving the natural gas economics and it denoted by economics of scale as the

higher the volumes the lower the unit cost of delivery

However Nigeria needs about 10000 km of gas pipelines to meet its power need and this would

results to approximately to about $12 per kilometer in terms of cost (wwwgreendealnigeriaorg)

According to NNPC News Vol 15 No 18 (2019) Nigerian National Petroleum Corporation

(NNPC) is working to have Nigeria ndash Morocco gas pipeline that would be linked up with the

existing Maghreb-Europe gas pipeline in northern Morocco to supply gas from Nigeria to Europe

The feasibility study has been concluded while the Pre-FEED (Front End Engineering Design)

The pipeline would transverse about fifteen (15) west african countries with intake and offtake

parts in various countries

321 Gas Transportation Tariff

According to National Petroleum Fiscal Policy (2016) a gas transportation tariff of $08MMSCF

has been approved by the Ministry of Petroleum through the 2008 national gas supply and pricing


DOI 105281zenodo2653083


regulations The applicable cap to gas transportation tariff shall be calculated and adjusted in

accordance with the following formula

CP = PP x CPIp CPIp-1 (321)

Where

CP = Contract Price

PP = Producer Price

CPI = Consumer Price Index

4 Conclusion and Recommendation

Based on this study there is need to privatize new gas pipeline investment and divest all existing

gas pipeline to private investors in order to ensure sustainable management The current gas

pipeline operators in Nigeria is the Nigeria National Petroleum Corporation (NNPC) through its

subsidiary Nigerian Gas Processing and Transportation With Private sector participation it will

break the monopoly of the NNPC and bring foreign direct investment that would create

competitive market gas pipeline The positive economic impact of the full private sectors

participation includes the following

1) Increase in the Gross Domestic Product to Nigeria

2) Increase of gas pipeline infrastructure in across the country will generate over 5000km of

gas pipeline transmission and distribution network

3) Increase in employment to tune of over 500 employed per year

4) Technology transfer from the use of modern gas pipeline

5) It would create access to the use of clean energy

Secondly there is need to have gas pipeline transmission and distribution policy that would be

rectified into an act by the parliament (the senate and house of representatives) The gas pipeline

act shall stipulate the following as a minimum

1) There shall be single regulatory body for gas pipeline in Nigeria

2) It shall contain clause to protect the foreign direct investors

3) It shall contain clauses on taxation accruable to the government

4) It shall the minimum requirement in terms of equity and debt ownership of the gas pipeline

operating companies

5) It shall provide relevant clause of local content employment to protect Nigerian boost

employment and gross domestic product

Acknowledgement

I thank in a special way my course lecturers and course matesfor the great time spent together at

the graduate school attending lectures and sharing ideas The administrative and support staff of

the institute is not left out in this commendation as they offered an enabling environment for my

academic work

I am grateful to my lovely wife Mrs Awele Evelyn Henry-Biose for her encouragement and

moral support I also thank my daughters Onyinyechukwu Ngozichukwu and Ugochukwu for


DOI 105281zenodo2653083


sparing me time for my research and studies My warm appreciation to my parents Mr and Mrs

Martin Biose and most especially my father who has been a source of moral support towards

academic excellence and his persistent encouragement for advanced studies

Appendices

Appendix A Table 10 Nigeria gas pipeline specification

National Gas Specification

1 Composition Min Max

Hydrocarbon Dewpoint - 100C (500F)

Water content - 75lbsMMScf

Methane (C1) 85 95 by volume

Ethane (C2) 0 10 by volume

Propane (C3) 0 8 by volume

Butane + Paraffin (C4+) - 5 by volume

H2S - 4 ppm by volume

Total Sulphur - 28 ppm by volume

CO2 - 4 by volume

N2 - 3 by volume

O2 - 10 ppm by volume

2 Heating Value

Higher Heating Value 1000 1150 Btu per scf

Wobbe Index (HHV basis) 47 52

3 Delivery Temperature

Recipient Temperature 100C (500F) 490C (1200F)

Source Gas Aggregation Company of Nigeriawww gacncom (2018)

Appendix B

Figure 13 West African Gas Pipeline Map

Source National Gas Policy (2017)


DOI 105281zenodo2653083


Appendix C

Table 22 Commercial gas distribution in Nigeria

SN Gas Supply System Gas Consumers Design Capacity

(mmscfd)

1 Aladja Gas Pipeline System Delta Steel Plant Aladja 70

2 Oben - Ajaokuta Gas Pipeline Ajaokuta Steel Plant 200

3 Sapele System NEPA Power Station Sapele 200

4 Obigbo North - Afam NEPA Afam 135

5 Imo River -Aba Igi Pz Abatex Aba Equitable 35

6 Alakiri - Onne Nafcon Onne 90

7 Escravos -Lagos Pipeline and the

Spur Lines

Nepa Egbin Spur 600

Nepa Delta IV Spur 172

Ughelli 40

Warri Refinery 45

Wapco Ewekoro Wapco 94

Ikeja City Gate OttaAgbara 50

Pz Industries Ikorodu 426

Edjeba amp Ogunnu Housing Estate 26

8 Alakiri - Obigbo North IkotAbasi Aluminum Smelting Company

(Alscon)

450

Source Aimikhe et al (2013)

Appendix D

Figure 14 The Trans-Sahara Gas Pipeline Route

Source Nigerian Gas Policy (2017)


DOI 105281zenodo2653083


Appendix E

Figure 15 Nigerian Existing and Proposed Gas Pipelines



DOI 105281zenodo2653083


Appendix F

Table 24 Nigerian domestic gas obligation and performance

Source Department of Petroleum Resource (2017)

References

[1] Nigerian National Gas Policy (2017) 1-8

[2] Nigerian National Petroleum Fiscal Policy (2016) 77

[3] Department of Petroleum Resources Annual Report (2017)78-96

[4] Guardian Newspaper Nigeria Announces Policy to end gas flaring in two years (2018)3

[5] Nigeria Gas Competence Seminar National Gas Flare Commercialization Program (2016) 1-25

[6] Odunuga J Green and Brown Field Development (2016)1-33

[7] NAM The Economic Benefit of Natural Gas Pipeline Development on the Manufacturing Sector

(2016) 4-47

[8] wwwgreendealnigeriaorg[accessedon 20th October 2018]


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[9] Gas Aggregation Company of Nigeria www gacncom (2017)

[10] wwwnnpccom [accessed on 20th October 2018]

[11] wwwthenationonlinengnet [accessed on 20th April 2019]

Corresponding author

E-mail address harios2003 yahoocom


DOI 105281zenodo2653083


resulted to having inadequate domestic gas supply obligation because the pipeline infrastructures

are not enough to meet the local demand of natural gas (Department of Petroleum Resource Annual

Report 2017) According to DPR (2017) the Nigerian national pipeline capacity for the year 2018

is 29 bscfd with 20 bscfd for the western region axis and 09 bscfd for eastern region axis and

this is relatively small to support economic development in Nigeria While according to the

National Gas Policy (2017) there are proposed gas pipeline network but the economics and

commercial framework for this proposed pipeline network are still vague and need to be modeled

for economic development from conceptual stage to operations considering the Nigerian socio ndash

economic conditions and long term framework that would generate revenue to the Nigerian

government and create positive economic multiplier effect such as increase in direct and indirect

employment The existing spread of gas pipelines is categorized into northern region western

region and eastern region Figure 10 shows the gas pipeline network within the northern region of

Nigeria and this clearly shows lack of gas pipelines within this region

Figure 10 Northern Region Gas Pipeline Network


While figure 11 shows the western and eastern region gas pipeline network indicating the

inadequacy of the existing gas pipeline network though as the region with relatively more gas

pipeline network and this is still inadequate to meet the demand or domestic supply obligation as

there no gas distribution network within any major city or town in this region of Nigeria


DOI 105281zenodo2653083



























DOI 105281zenodo2653083











































DOI 105281zenodo2653083


























(DPR) (wwwnnpccom)











industries


DOI 105281zenodo2653083



Sapele










































DOI 105281zenodo2653083



(311)

( (312)




















bull NOPL (50km)









FETD

ctSPMAWP

)(2)(

minus=

cSFET

PDt

DESIGN+=

2

)(

(min)


DOI 105281zenodo2653083








(wwwnapimscom)















460MMscfd










Benin and Togo









DOI 105281zenodo2653083






















million


US$360 million






















DOI 105281zenodo2653083













(Dami 2012)






countries






















DOI 105281zenodo2653083





Where

CP = Contract Price

PP = Producer Price























operating companies



Acknowledgement




academic work




DOI 105281zenodo2653083





Appendices












CO2 - 4 by volume

N2 - 3 by volume


2 Heating Value






Appendix B




DOI 105281zenodo2653083


Appendix C



(mmscfd)








Spur Lines

Nepa Egbin Spur 600


Ughelli 40

Warri Refinery 45






(Alscon)

450


Appendix D




DOI 105281zenodo2653083


Appendix E




DOI 105281zenodo2653083


Appendix F



References








(2016) 4-47



DOI 105281zenodo2653083








DOI 105281zenodo2653083



























DOI 105281zenodo2653083











































DOI 105281zenodo2653083


























(DPR) (wwwnnpccom)











industries


DOI 105281zenodo2653083



Sapele










































DOI 105281zenodo2653083



(311)

( (312)




















bull NOPL (50km)









FETD

ctSPMAWP

)(2)(

minus=

cSFET

PDt

DESIGN+=

2

)(

(min)


DOI 105281zenodo2653083








(wwwnapimscom)















460MMscfd










Benin and Togo









DOI 105281zenodo2653083






















million


US$360 million






















DOI 105281zenodo2653083













(Dami 2012)






countries






















DOI 105281zenodo2653083





Where

CP = Contract Price

PP = Producer Price























operating companies



Acknowledgement




academic work




DOI 105281zenodo2653083





Appendices












CO2 - 4 by volume

N2 - 3 by volume


2 Heating Value






Appendix B




DOI 105281zenodo2653083


Appendix C



(mmscfd)








Spur Lines

Nepa Egbin Spur 600


Ughelli 40

Warri Refinery 45






(Alscon)

450


Appendix D




DOI 105281zenodo2653083


Appendix E




DOI 105281zenodo2653083


Appendix F



References








(2016) 4-47



DOI 105281zenodo2653083








DOI 105281zenodo2653083











































DOI 105281zenodo2653083


























(DPR) (wwwnnpccom)











industries


DOI 105281zenodo2653083



Sapele










































DOI 105281zenodo2653083



(311)

( (312)




















bull NOPL (50km)









FETD

ctSPMAWP

)(2)(

minus=

cSFET

PDt

DESIGN+=

2

)(

(min)


DOI 105281zenodo2653083








(wwwnapimscom)















460MMscfd










Benin and Togo









DOI 105281zenodo2653083






















million


US$360 million






















DOI 105281zenodo2653083













(Dami 2012)






countries






















DOI 105281zenodo2653083





Where

CP = Contract Price

PP = Producer Price























operating companies



Acknowledgement




academic work




DOI 105281zenodo2653083





Appendices












CO2 - 4 by volume

N2 - 3 by volume


2 Heating Value






Appendix B




DOI 105281zenodo2653083


Appendix C



(mmscfd)








Spur Lines

Nepa Egbin Spur 600


Ughelli 40

Warri Refinery 45






(Alscon)

450


Appendix D




DOI 105281zenodo2653083


Appendix E




DOI 105281zenodo2653083


Appendix F



References








(2016) 4-47



DOI 105281zenodo2653083








DOI 105281zenodo2653083


























(DPR) (wwwnnpccom)











industries


DOI 105281zenodo2653083



Sapele










































DOI 105281zenodo2653083



(311)

( (312)




















bull NOPL (50km)









FETD

ctSPMAWP

)(2)(

minus=

cSFET

PDt

DESIGN+=

2

)(

(min)


DOI 105281zenodo2653083








(wwwnapimscom)















460MMscfd










Benin and Togo









DOI 105281zenodo2653083






















million


US$360 million






















DOI 105281zenodo2653083













(Dami 2012)






countries






















DOI 105281zenodo2653083





Where

CP = Contract Price

PP = Producer Price























operating companies



Acknowledgement




academic work




DOI 105281zenodo2653083





Appendices












CO2 - 4 by volume

N2 - 3 by volume


2 Heating Value






Appendix B




DOI 105281zenodo2653083


Appendix C



(mmscfd)








Spur Lines

Nepa Egbin Spur 600


Ughelli 40

Warri Refinery 45






(Alscon)

450


Appendix D




DOI 105281zenodo2653083


Appendix E




DOI 105281zenodo2653083


Appendix F



References








(2016) 4-47



DOI 105281zenodo2653083








DOI 105281zenodo2653083



Sapele










































DOI 105281zenodo2653083



(311)

( (312)




















bull NOPL (50km)









FETD

ctSPMAWP

)(2)(

minus=

cSFET

PDt

DESIGN+=

2

)(

(min)


DOI 105281zenodo2653083








(wwwnapimscom)















460MMscfd










Benin and Togo









DOI 105281zenodo2653083






















million


US$360 million






















DOI 105281zenodo2653083













(Dami 2012)






countries






















DOI 105281zenodo2653083





Where

CP = Contract Price

PP = Producer Price























operating companies



Acknowledgement




academic work




DOI 105281zenodo2653083





Appendices












CO2 - 4 by volume

N2 - 3 by volume


2 Heating Value






Appendix B




DOI 105281zenodo2653083


Appendix C



(mmscfd)








Spur Lines

Nepa Egbin Spur 600


Ughelli 40

Warri Refinery 45






(Alscon)

450


Appendix D




DOI 105281zenodo2653083


Appendix E




DOI 105281zenodo2653083


Appendix F



References








(2016) 4-47



DOI 105281zenodo2653083








DOI 105281zenodo2653083



(311)

( (312)




















bull NOPL (50km)









FETD

ctSPMAWP

)(2)(

minus=

cSFET

PDt

DESIGN+=

2

)(

(min)


DOI 105281zenodo2653083








(wwwnapimscom)















460MMscfd










Benin and Togo









DOI 105281zenodo2653083






















million


US$360 million






















DOI 105281zenodo2653083













(Dami 2012)






countries






















DOI 105281zenodo2653083





Where

CP = Contract Price

PP = Producer Price























operating companies



Acknowledgement




academic work




DOI 105281zenodo2653083





Appendices












CO2 - 4 by volume

N2 - 3 by volume


2 Heating Value






Appendix B




DOI 105281zenodo2653083


Appendix C



(mmscfd)








Spur Lines

Nepa Egbin Spur 600


Ughelli 40

Warri Refinery 45






(Alscon)

450


Appendix D




DOI 105281zenodo2653083


Appendix E




DOI 105281zenodo2653083


Appendix F



References








(2016) 4-47



DOI 105281zenodo2653083








DOI 105281zenodo2653083








(wwwnapimscom)















460MMscfd










Benin and Togo









DOI 105281zenodo2653083






















million


US$360 million






















DOI 105281zenodo2653083













(Dami 2012)






countries






















DOI 105281zenodo2653083





Where

CP = Contract Price

PP = Producer Price























operating companies



Acknowledgement




academic work




DOI 105281zenodo2653083





Appendices












CO2 - 4 by volume

N2 - 3 by volume


2 Heating Value






Appendix B




DOI 105281zenodo2653083


Appendix C



(mmscfd)








Spur Lines

Nepa Egbin Spur 600


Ughelli 40

Warri Refinery 45






(Alscon)

450


Appendix D




DOI 105281zenodo2653083


Appendix E




DOI 105281zenodo2653083


Appendix F



References








(2016) 4-47



DOI 105281zenodo2653083








DOI 105281zenodo2653083






















million


US$360 million






















DOI 105281zenodo2653083













(Dami 2012)






countries






















DOI 105281zenodo2653083





Where

CP = Contract Price

PP = Producer Price























operating companies



Acknowledgement




academic work




DOI 105281zenodo2653083





Appendices












CO2 - 4 by volume

N2 - 3 by volume


2 Heating Value






Appendix B




DOI 105281zenodo2653083


Appendix C



(mmscfd)








Spur Lines

Nepa Egbin Spur 600


Ughelli 40

Warri Refinery 45






(Alscon)

450


Appendix D




DOI 105281zenodo2653083


Appendix E




DOI 105281zenodo2653083


Appendix F



References








(2016) 4-47



DOI 105281zenodo2653083








DOI 105281zenodo2653083













(Dami 2012)






countries






















DOI 105281zenodo2653083





Where

CP = Contract Price

PP = Producer Price























operating companies



Acknowledgement




academic work




DOI 105281zenodo2653083





Appendices












CO2 - 4 by volume

N2 - 3 by volume


2 Heating Value






Appendix B




DOI 105281zenodo2653083


Appendix C



(mmscfd)








Spur Lines

Nepa Egbin Spur 600


Ughelli 40

Warri Refinery 45






(Alscon)

450


Appendix D




DOI 105281zenodo2653083


Appendix E




DOI 105281zenodo2653083


Appendix F



References








(2016) 4-47



DOI 105281zenodo2653083








DOI 105281zenodo2653083





Where

CP = Contract Price

PP = Producer Price























operating companies



Acknowledgement




academic work




DOI 105281zenodo2653083





Appendices












CO2 - 4 by volume

N2 - 3 by volume


2 Heating Value






Appendix B




DOI 105281zenodo2653083


Appendix C



(mmscfd)








Spur Lines

Nepa Egbin Spur 600


Ughelli 40

Warri Refinery 45






(Alscon)

450


Appendix D




DOI 105281zenodo2653083


Appendix E




DOI 105281zenodo2653083


Appendix F



References








(2016) 4-47



DOI 105281zenodo2653083








DOI 105281zenodo2653083





Appendices












CO2 - 4 by volume

N2 - 3 by volume


2 Heating Value






Appendix B




DOI 105281zenodo2653083


Appendix C



(mmscfd)








Spur Lines

Nepa Egbin Spur 600


Ughelli 40

Warri Refinery 45






(Alscon)

450


Appendix D




DOI 105281zenodo2653083


Appendix E




DOI 105281zenodo2653083


Appendix F



References








(2016) 4-47



DOI 105281zenodo2653083








DOI 105281zenodo2653083


Appendix C



(mmscfd)








Spur Lines

Nepa Egbin Spur 600


Ughelli 40

Warri Refinery 45






(Alscon)

450


Appendix D




DOI 105281zenodo2653083


Appendix E




DOI 105281zenodo2653083


Appendix F



References








(2016) 4-47



DOI 105281zenodo2653083








DOI 105281zenodo2653083


Appendix E




DOI 105281zenodo2653083


Appendix F



References








(2016) 4-47



DOI 105281zenodo2653083








DOI 105281zenodo2653083


Appendix F



References








(2016) 4-47



DOI 105281zenodo2653083








DOI 105281zenodo2653083







gas pipelines in nigeria: sine qua non for economic

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